As Greer sees it, there are a number of viable investment options that organizations have when attempting to improve employee retention. These range from helping to create a conducive growth atmosphere in which to work, which could require an investment in improved working conditions, adequate training, and "perks" such as time off, all the way to financial incentives such as stock options and profit-sharing plans. Of course, not all of these incentives for retention are available at all levels of most organizations, and there is some research that suggests that they should be.
Regarding financial incentives, he suggests, "Equitable compensation is important for employee retention. In turn, greater compensation equity occurs with fair appraisal reviews" (Greer, 2001m 15).
Greer then suggests that there is a strong correlation between the commitment that an organization has towards retaining employees and the amount of funds they are willing to spend. Regardless of this correlation, the fact that companies are willing to invest to retain employees suggests that the trend is definitely toward looking at employees as human capital.
The direct balance sheet costs connected with downsizing can include: A) Relocation or outplacement costs for key employees; B) Severance Pay costs for other employees; C) Reduction or elimination of leases and contracts; D) Possible legal and accounting fees; E) One-time charge backs that can have a temporary revenue impact.
The indirect costs can include: A) Dilution of employee effort based on bad morale with the downsizing; B) Losses attributed to new systems manifestations; C) Exodus of employees who believe that the company is in trouble. Most of these indirect situations (and these are only three of many) can be handled by effective communications and solid human resources practice. The benefits that can occur include: A)Cost savings; B) More efficient production; C) Greater employe...